The Federal Reserve's response to the 2001 recession was to
A. raise the margin requirement and lower the reserve requirement.
B. reduce the money supply by 7% in order to reduce overinflated stock prices.
C. cut the federal funds rate over a three-year period.
D. reduce the reserve requirement.
Answer: C
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The legal system provided by the government is necessary for the smooth working of markets because
A) it keeps criminals off of the streets. B) it defines and protects property rights. C) it is set up in the U.S. constitution. D) it ensures that producers maximize their profits.
If aggregate quantity supplied exceeds aggregate quantity demanded, we can expect an unplanned
a. depletion of inventories, causing firms to raise prices. b. depletion of inventories, causing firms to lower prices. c. accumulation of inventories, causing firms to raise prices. d. accumulation of inventories, causing firms to lower prices.
Suppose that the U.S. can make 15 cars or 20 bottles of wine with one year's worth of labor. France can make 10 cars or 18 bottles of wine with one year's worth of labor. From these numbers, we can conclude
A. the U.S. has a comparative advantage in the production of cars. B. France has a comparative advantage in the production of wine. C. the U.S. has a absolute advantage in the production of wine. D. all of the above are conclusions are correct.
Suppose Sarah owns a small company that makes wedding cakes. The accompanying table shows how Sarah's total cost varies depending on the number of wedding cakes she makes each day.Number of Cakes Per DayTotal Cost Per Day0$1001$1802$2203$3004$4005$5206$660 Sarah's fixed cost is ________ per day.
A. $100 B. $10 C. $20 D. $200